SD corn producers join formal filing in VeraSun case

November 25, 2008

South Dakota corn producers holding corn contracts with VeraSun have joined with growers from other states to file a formal objection with the U.S. Bankruptcy Court in Delaware to have representation as the fate of current VeraSun corn contracts are decided.

National Corn Growers Association (NCGA) Chairman Ron Litterer is officially named in the filing. Litterer, a corn grower from Greene, Iowa, has an outstanding contract to deliver corn to VeraSun. He filed the objection with and on behalf of corn growers in at least seven other states that have similar situations and are concerned with VeraSun’s proposed procedures to reject outstanding contracts.

“It is doubtful that we can influence the courts to require VeraSun to pay the contracted price for our corn. However, we do hope to influence other issues of concern to growers,” Litterer said.

While only those who have business dealings in progress with VeraSun can be named in the filing, the South Dakota Corn Growers Association (SDCGA) is networking with NCGA on this effort. As such, any South Dakota corn producer under contract with VeraSun is encouraged to call the SDCGA office at 605-334-0100 to provide contact information.

“SDCGA is taking an active role in advocating for our state’s corn growers’ interests in this case,” said Bill Chase, president of the SDCGA. “We understand this is a very important financial situation for corn growers and we urge VeraSun contract holders to call our office and register their name with our organization so we may keep them informed as the court case progresses.”

SDCGA’s action to collaborate with NCGA and other state associations on single representation will allow for the most effective and cost efficient action for producers.

“It is imperative that we protect corn suppliers’ common interests in these cases and present a uniform voice for growers to negotiate and proactively pursue solutions with the debtors,” said Reid Jensen, president of the South Dakota Corn Utilization Council (SDCUC).

The objection filed indicates specific concerns with VeraSun’s proposed procedures under bankruptcy, which may allow VeraSun to wait until 10 days before the contracted delivery date to notify growers that their contract was rejected.

“That would place producers in an unfair position in the marketplace, potentially causing growers to lose out on their contracted price and unable to take advantage of alternative marketing opportunities,” said Chase.

The SDCGA is closely monitoring the VeraSun situation and taking steps to keep SDCGA members informed of the latest developments.

Potentially thousands of corn growers from Indiana, Iowa, Michigan, Minnesota, Nebraska, North Dakota, Ohio, South Dakota and other states have contracts with VeraSun.